AFS 250 Market Snapshots Webinar Friday, July 27, 2018 Jonathan - - PowerPoint PPT Presentation

AFS 250 Market Snapshots Webinar

Friday, July 27, 2018 Jonathan Chapman, Director of CHC Advisory Services, Capital Link

Capital Link

• Launched in 1995, nonprofit, HRSA national cooperative partner
• Offices in CA, CO, MA, ME, MO, SC and WV
• Over $1.1 billion in financing for over 230 capital projects
• Direct assistance to health centers and complementary nonprofit
• rganizations in planning for and financing operational growth and capital

needs

• Industry vision and leadership in the development of strategies for
• rganizational, facilities, operational and financial improvements
• Metrics and analytical services for measuring health center impact,

evaluating financial and operating trends and promoting performance improvement

CCALAC Advancing Financial Strength (AFS) Program Overview

Not a “CFO Training Program” but an integrated learning experience.

CEO/COO CMO/ Clinical Team CFO/Finance Team Board Members Support Staff

Goal: Financial Sustainability and Access to High Quality Care

Improved Access & Financial Sustainability

Today’s Agenda

• Market Snapshots - Defined
• Using the Data Already at Hand
• “Back of the Envelope” Calculations

Why a Market Assessment?

Assess and Manage Risk on the Edge…

Market Assessment

Things to Consider Before You Start

• What is your perceived Market?
• Market can = geography, specific population, service type, etc.
• The resulting data will likely inform & expand any ‘gut instinct’
• There is A LOT of data out there
• Reviewers may occasionally have a differing opinion

Capital Link’s Typical Table of Contents

• Health Center Overview
• Service Area Identification
• Service Area Description
• Comparative Demographics and Economic Indicators
• Medical Needs of the Service Area
• Estimating Service Area Demand
• Special Considerations

Market Snapshot

Market Snapshot Table of Contents

• Introduction
• Patient Origin
• Percentage of Low-Income Residents by Zip Code
• Number of Low-Income Residents by Census Tract
• Percent Penetration of Low Income Pop by FQHCs
• Unserved Low-Income Population
• About the Sources

HRSA UDS Website UDSMAPPER UDSMAPPER U.S. Census UDSMAPPER Individual UDS

Market Snapshot - Introduction

• Market Snapshot Defined
• Sources of Data/Graphics
• Summary of Primary Service Area

Market Snapshot – Patient Origin

• Approximately 75% of total patients is considered

Primary Service Area

• Next 20-25% is Secondary Service Area
• HRSA UDS Website

Market Snapshot – Percentage of Low-Income Residents by Zip Code

• Begin to Consider FQHC Total Possible Market
• Illustrate Zip Code Boundaries and Primary Service Area
• Identify Those Zip Codes with Highest Poverty Ratios
• Identify FQHCs within Service Areas

Market Snapshot – Number of Low-Income Residents by Census Tract

• Calculate Total Possible FQHC Market
• UDSMAPPER Does Not Provide Number of Low-Income Residents
• Census Tracts Typically are

Smaller Geographic Area than Zip Codes; Allowing for More Specific Calculations and Planning

Market Snapshot – Percent Penetration Low-Income Population by FQHCs

• Illustrates the Percentage of Low-Income Residents Being Served

by FQHC

• Identify Those Zip Codes Where FQHCs have Significant (or Little)

Presence

• You Know Your Patients by Zip Code –

Begin to Calculate Other FQHCs’

Market Snapshot – Unserved Low-Income Population

• Quickly Identify Those Zip Codes in and around the Primary

Service Area and Their Number of Unserved Low-Income Residents

• Helps Determine and Perhaps Prioritize

Outreach Methods, Intensity, and Message

• Contributes to Strategic Planning
• Can Help Define and Direct Goals

Market Snapshot – Overview

• Visually Conveys
• Primary Service Area

(Individual FQHC Geographic Footprint)

• Low-Income Population

(Total Potential FQHC Market)

• Low-Income Population Being Served by FQHCs

(FQHC Market Penetration)

• Low-Income Population Not Being Served by FQHCs

(Total Potential FQHC Patients)

• Good, Basic Introduction to Service Area and Market Questions
• Are There Materials to Further Clarify and Address These Initial

Findings and Questions?

Additional Data to Reduce Uncertainty & Risk? Using Data Already at Hand

Demographics and Economic Indicators

• Compare state, county, metropolitan areas, cities, zip codes, etc.
• Populations
• Race
• Income Ratios
• Education
• Language
• Business Establishments and Employees by Industry
• Disabilities
• Many more, usually according to health center specifics

Medical Needs of Service Area

• Compare state, county, metropolitan areas, cities, zip codes, etc.
• General health indicators
• Other Health Providers and Facilities
• Health Professional Shortage Areas (HPSA) and MUA/Ps
• Health Disparities
• Selected Workforce Considerations

Estimating Service Area Demand

• Evaluate service area market share
• Populations by Various Characteristics
• Payer mix
• Population Projections

http://www.dof.ca.gov/Forecasting/Demographics/Projections/

• Anticipate changing demographics and their effect on services

and operations

• Identify Additional Needs and Level of Demand
• Estimating potential patients, visits, providers, capital needs

Market Assessment - Expansion An organization wants to consider increasing its low income population market share by 5%. How many more patients, visits, and providers would that mean?

Market Assessment - UDSMAPPER

15 minutes drive time from zip code 90012 in Los Angeles, California

Market Assessment - UDSMAPPER

15 minutes drive time from 90012 in Los Angeles, California WITH TRAFFIC CONSIDERATION

Market Assessment - UDSMAPPER

Added layer with health center and hospital locations

Market Assessment - UDSMAPPER

Market Assessment - UDSMAPPER

Market Assessment - UDSMAPPER

Market Assessment – UDSMAPPER Data

US Census FactFinder

US Census FactFinder

• Geographies by census block, tract, zip code, county, state, etc.

US Census FactFinder

• Veterans, SNAP, family structure, poverty, language, housing,

transportation, businesses (county and zip code business patterns), disability, origins, etc.

Policy Map

Policy Map - Health

County Health Rankings

County Health Rankings

Aunt Bertha

Aunt Bertha

Aunt Bertha

Back of the Envelope

Hypothetical Expansion Considerations

• Market Share – Current and Projected
• Number of Patients from specific population divided by that total population
• Service Area FQHC Patients = 133,390
• Service Area General Population = 714,575; Low Income Population = 425,426
• 19% market share General Population; 31% market share Low Income Population
• Estimating Encounters/Visits
• Historic/Realistic visits per patient times expected patients
• FQHC Visits = 586,916
• 586,916 / 133,390 = 4.4 visits per patient
• Projecting Workforce Needs
• Historic/Realistic Provider Productivity divided by expected visits/patients
• FQHC Provider FTE = 628
• FQHC Visits = 586,916
• 586,916 / 628 = 934 visits per FTE

Hypothetical Expansion Considerations

• An organization wants to increase its low income population

market share by 5%; how many more patients, visits, providers?

• 31% x 1.05 = 32.55 = 33%
• 33% x 425,426 = 140,391 patients

(increase of 7,000 low income patients)

• 7,000 x 4.4 visits per patient = 30,800 additional visits
• 30,800 / 934 visits per Provider FTE = 33 additional Provider FTEs

Hypothetical Expansion Considerations

• Estimated Square Footage/Funding Needed to Treat

New Patients – HYPOTHETICAL

• Using estimated square feet per provider as basis…1,100
• 33 FTE x 1,100 sq ft per = 36,300 total sq ft
• Using estimated cost per square foot as basis…$4801
• 36,300 sq ft x $480/sq ft = $17.4M estimated cost

Hypothetical Expansion Considerations

Hard Costs: 70% Equipment: 15% Soft Costs: 15% Total Project Cost 100% + Land/Building Acquisition Typical Breakdown of Project Costs for Health Centers:

Service Expansion - Immunization Rates and Costs

• Tetanus, Diphtheria, and Pertussis
• Not being vaccinated results in approximately 5,320 cases per 100,000 children
• $17,000 in hospitalization costs per case
• Dtap Vaccine = $80/child
• 74,000 children under 5 years of age in service area
• Current Immunization Rate = 70%

30% = $20 million in costs

• Spend $1.6 million to increase the Immunization Rate to 80%
• New Immunization Rate = 77%

23% = $15 million in costs

Reduction of Hospitalization Costs of $5 Million

Determining Priorities

Low Income Population

HPSA Score

LOW HIGH

Planning with Available Market Data

• Complexity (or Lack Thereof)
• Less Time
• Lower Costs
• Hints at Consequences
• Enhances Our Thought/Decision Process
• Reduces Reactionary Responses
• Does Not Have to be Precise to be Useful

Capital Link’s Typical Table of Contents

• Health Center Overview
• Service Area Identification
• Service Area Description
• Comparative Demographics and Economic Indicators
• Medical Needs of the Service Area
• Estimating Service Area Demand
• Special Considerations

” “

A good plan today is better than a perfect plan tomorrow.

Market Assessment – Selected National Resources

• UDSMAPPER and HealthLandscape: www.UDSMAPPER.org
• US Census FactFinder: https://factfinder.census.gov
• US Census QuickFacts: https://www.census.gov/quickfacts
• County Health Rankings: http://www.countyhealthrankings.org/
• HRSA’s Data Warehouse: https://datawarehouse.hrsa.gov/
• Aunt Bertha: https://www.auntbertha.com/
• CDC/Nat’l Center for Health Statistics (FastStats): https://www.cdc.gov/nchs/index.htm
• Policy Map: https://www.policymap.com/
• Capital Link Publications and Toolkits: http://www.caplink.org/index.php/resources
• US SBA’s Market Analysis: https://www.sba.gov/tools/sba-learning-

center/training/market-research

Contact

Questions?

Visit us Online: www.caplink.org

• Learn more about our products and services
• Download our free publications and resources
• Register for upcoming webinars
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• Subscribe to our blog at capitallinksblog.blogspot.com

Jonathan Chapman Director of CHC Advisory Services 970-833-8513 jchapman@caplink.org